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In about mid-June, Ethiopia’s new youthful prime minsister Abiy Ahmed and host, Egyptian president, Abdel Fattah al-Sisi, came out of a meeting in Cairo with unusual optimism and mutual confidence that suggested erstwhile tensions on the $4 billion 6,000MW Grand Ethiopian Renaissance Dam (GERD) being built on the River Nile would perhaps no longer be a source of concern to investors and all. What changed? Mr Ahmed. In the little time that he has had in office thus far, he has done quite a bit to ease tensions in the restive Oromia region, the part of Ethiopia he hails from, released political prisoners, extended an olive branch to neighbouring Eritrea, relations with which have been sour for ages, and so on. There is certainly huge optimism about Ethiopia at the moment. The country’s banking and telecommunications sector, sought after for years by international investors, if liberalised as increasingly expected, could easily put to rest perennial troubles with foreign exchange supply and much needed jobs. In this regard, Lemma Senbet, chief executive of Nairobi-based African Economic Research Consortium is “cautiously optimistic.” That is probably the current Egyptian sentiment to statements by Mr Ahmed at the press conference after his meeting with Mr Sisi in Cairo such as this: “We will take care of the Nile and we will preserve your share and we will work to increase this quota and President Sisi and I will work on this”. With the River Nile flowing downstream to Egypt from Ethiopia via Sudan, the land of the pharaohs – which also has a big dam of its own on the Nile, the 2,100 MW Aswan High Dam – could potentially lose more from the likely reduced flow of the river that the GERD would cause. And with water increasingly scarce, Egyptian authorities could hardly afford even the slightest threat to what has been a source of livelihood for their people for millennia. Even as “Egypt [was] increasingly being compelled to accept the reality of the GERD, and thus [likely already focusing] on negotiating to limit the dam’s downstream impacts rather than opposing its existence outright”, like Jordan Anderson, sub-Saharan Africa risk analyst at London-based IHS Markit, a research firm, suggests, mistrust between the two sides made progress difficult hitherto.

One-man risk necessitate international mediation
Egyptian authorities were becoming increasingly frustrated in fact: “There is a need to accelerate the pace of negotiations after some three years or more have passed since the signing of the preliminary agreement in Khartoum and things have remained frozen,” Egyptian foreign minister Sameh Shoukry told reporters in late April (according to Reuters). The Egyptian view was that Ethiopia was deliberately dragging its feet in what had become longwinded talks that seemed to achieve little else but buy Ethiopia time. Its fears were not unfounded. In addition to the advantages Ethiopia clearly enjoys already, once the dam is completed, it would be in an even stronger negotiating position. Sudan, on the other hand, seemed more agreeable to the Ethiopian side early on. This is not surprising. There are more benefits for it from the dam than are troubles. Sudanese authorities are excited about the power that would be transmitted to its grid from the dam, for instance. Naturally, both countries have found it easier to cooperate; agreeing to develop the Port Sudan in early May and establish a joint military force to protect the GERD. Understandably, warmer relations between Ethiopia and Sudan became increasingly worrying for Egypt. With the recent rapprochement between the Ethiopian and Egyptian sides, however, that would no longer be the case, it is hoped.

Despite better relations, Egypt likely still desires some international mediation. When it first mooted the idea, it suggested the World Bank. Hailemariam Desalegn, the Ethiopian prime minister at the time, would have none of it. Not that he minded getting technical help from the Bretton Woods institution. But with the negotiation advantages Ethiopia clearly enjoyed, it probably did not seem rational to him for his country to cede control to any external institution, even the World Bank. Still, despite the uneasy relations at the time, Egypt and Ethiopia did manage to be as constructive as possible. To this end, both countries signed a political and diplomatic consultation agreement in January. And fears hitherto that Egypt might have a contigency military solution have certainly now receded. IHS Markit’s Anderson explains why it is highly unlikely it would go to such lengths: “The Egyptian government is unlikely to isolate itself internationally by taking any kind of unilateral military action against the GERD, and it also lacks the military capacity to make such an operation probably successful.”

The immediate priority is to agree modalities for filling the dam’s reservoir – which could start as early as July during the Nile flood season – and how to ensure dams downstream in Sudan and Egypt would not be overly constrained. Both downstream countries also want water from the river to be amply available for irrigation and myriad other uses during any filling period on the one hand, and when once filled, water would be released from the reservoir, unconditionally and as needed, for their benefit during difficult periods; a prolonged drought, say. A resolution between the parties at their meeting in mid-May suggests they are likely to agree more than than they disagree from now on. They plan to meet more regularly, at least; every six months in fact. A joint fund to build infrastructure in the three countries is also planned. A compromise has also been reached on differences over the introductory technical report by BRL Group, a French water consultancy, on the potential downstream impact of the GERD: a new one by a team consisting of members from the three countries has been contracted. This is not ideal, of course. A scientific evaluation hardly needs the distraction of the politics around its deliverable. It certainly highlights the necessity of a neutral international arbiter in the process to ensure even decisions as supposedly straightforward as appointing an independent scientific team would not be enmeshed in needless politics. Refreshingly, the Egyptian government has begun to take confidence-building measures of its own. As a goodwill gesture to Mr Ahmed, thirty Ethiopian prisoners were released from Egyptian jails in June. The deep-seated emotions of Egyptians to the Nile remain nonetheless. Take the unprecedented move by Mr Sisi of asking Mr Ahmed to swear before the Egyptian people during his visit in June that he would protect their interests. Mr Ahmed did not hesitate: “I swear to God, we will never harm you”. He probably meant every word. But is it a promise he can keep? Already, he faces resistance from the erstwhile ruling Tigray elite. To free Andargachew Tsige, a prominent opposition figure on death row for about four years hitherto, Mr Ahmed threatened to resign in response to resistance by them. He has also been ruffling feathers within the military establishment; members of which enjoy wideranging influence over the Ethiopian economy. With fast-paced reforms by Mr Ahmed already chipping away their fabled tight grip, it is probably only a matter of time before their currently restrained grumblings boil over; especially as the security establishment is believed to have entered into a tacit agreement with Mr Ahmed for the maintenance of certain rigidities – one of which is likely to be the GERD negotiations – in exchange for supporting his candidacy for prime minister. The importance of international mediation cannot be overemphasized.

An edited version was published by African Business magazine in July 2018